Correa sends in army to shut down illicit gold mines, while touting large-scale mining as a major source of income.

President Rafael Correa sent in the military so shut down illegal gold mines in the northwestern coastal Esmeraldas province. Soldiers blew up gold mining equipment, including backhoes, dredges and generators with dynamite, to destroy the industry whose revenue the government says is tied to drug traffickers and causes irreversible environmental and health damage, including cancer.

“If illegal mining continues, we will firmly act wherever and destroy that machinery with judicial support, before we let our forests, rivers, jungle and our people be destroyed,” said Correa on May 31. The government issued a 90-day limit for miners to shut down illegal operations around the country.

“In the last six months, US$130 million worth of gold has been illegally extracted. And one ton of alluvial soil must be removed to obtain just 30 grams of gold,” Natural Resource Minister Wilson Pástor said.

While Correa’s government, like that of neighboring Peru, a major gold producer, is cracking down on illegal gold mining, it is promoting medium- and large-scale mining, which would be regulated by the state and generate revenue for government coffers. With prices above $1,500 per ounce, both governments are eager to cash in.

Pástor said the country expects $3.5 billion in mining investments over the next two years and that it will consider raising royalties above the current 5 percent.

Mining activity had been halted in Ecuador since 2008 as the government overhauled an old mining law to increase the state’s share of royalties. —Latinamerica Press.